The Department of Justice is taking legal action against RealPage, the company behind a popular software used by landlords to set rental prices. According to the lawsuit, the DOJ and eight states claim that RealPage’s algorithm drives up rental prices and hampers competition in the market. The company allegedly obtains nonpublic rental price information from competitors using the software, which it then uses to provide pricing suggestions to landlords. These suggestions go beyond mere recommendations, as RealPage also influences landlords’ policies, aiming to eliminate concessions and discounts for renters.
The complaint asserts that RealPage’s practices go against the principles of fair competition. By compelling landlords to outsource their pricing decisions to the company’s algorithm, RealPage effectively eliminates independent decision-making and market competition. In a competitive environment, each landlord should have the freedom to offer concessions to attract tenants. However, RealPage’s actions seek to stifle this autonomy by promoting collective action among landlords to standardize pricing strategies.
Moreover, the lawsuit accuses RealPage of maintaining a monopoly in the commercial revenue management software sector for multi-family dwellings, holding an alarming 80 percent market share. The company’s alleged anti-competitive agreements with landlords, coupled with the sensitive data it collects from them, provide RealPage with an unfair advantage over competitors. These practices not only undermine the principles of fair competition but also restrict consumers’ choices and hinder market innovation.
RealPage has been under the Department of Justice’s radar for a significant period, indicating a pattern of behavior that raises concerns about its market conduct. The lawsuit underscores the government’s commitment to upholding fair competition and protecting consumers from anti-competitive practices. Through legal action, the DOJ aims to hold RealPage accountable for its alleged violations and ensure a level playing field in the rental market for both landlords and renters.
The Department of Justice’s lawsuit against RealPage sheds light on the importance of maintaining fair competition in the business landscape. By challenging anti-competitive practices and monopolistic behavior, regulatory bodies can safeguard consumer interests and foster a more equitable and competitive marketplace. It is crucial for companies to abide by laws that promote fair competition and prevent the abuse of market dominance to protect the rights of consumers and promote economic efficiency.